Johnnie Brown v. C. Volante Corp.Johnnie Brown v. C. Volante Corp.
STACEY E. ZISKIN, Law Offices of Robert M. Ziskin (Robert M. Ziskin, of counsel), Commack, New York, for Defendant-Appellant.
EUGENE S. FRIEDMAN, Friedman & Levine (William K. Wolf, Michael Bauman, William Anspach, of counsel), New York, New York, for Plaintiffs-Appellees.
WINTER, Chief Judge:
C. Volante Corp. appeals from Judge Gershon‘s orders granting appellees’ motion for summary judgment and awarding damages. Appellant argues that: (i) the district court lacked subject matter jurisdiction over appellees’ claims because they arose from an alleged breach of unsigned collective bargaining agreements, (ii) the district court erred in determining that there were no triable issues as to whether appellant manifested its intent to adopt unsigned collective bargaining agreements, and (iii) the district court made several erroneous findings in connection with its damages award. We affirm.
BACKGROUND
Appellant was a signatory to a CBA in effect from July 1, 1987 to June 30, 1990. It did not, however, sign two subsequent CBAs, governing the period July 1, 1990 to June 30, 1996. Pursuant to all the CBAs, employers agree to contribute a fixed dollar amount to the Fund contingent upon the number of hours its employees work.
Although appellant did not sign the CBAs effective from July 1, 1990 to June 30, 1996, it submitted monthly remittance reports during this period. These sixty-one reports detailed hours worked by appellant‘s employees and its contributions to the Fund as determined by the hours worked. Each report was accompanied by the payment calculated in the report. Each of the reports was signed by appellant‘s then-Chief Executive Officer as “Pres.,” and most of them contained a typewritten phrase indicating it was submitted “[i]n Accordance with the terms of the standard Industry Agreement with Local 282, I.B.T.”
The parties do not dispute that appellant‘s payments to the Fund accorded with the rates set forth in the operative CBA. Rather, the Trustees’ claim stems from appellant‘s alleged failure to make payments to the Fund for all of its employees.
The Trust Agreement, incorporated by reference in the CBAs, provides for periodic auditing of an employer‘s records concerning payments to the Fund. During November and December, 1993, the Trustees conducted an audit of appellant‘s records covering the period from May 30, 1990 through September 30, 1993. Appellant cooperated in this audit even though most of it concerned months during which appellant was not a signatory to a CBA. The Trustees’ resulting audit report showed that appellant owed more than $78,000.00 to the Fund.
After receiving the audit report, Rita Volante wrote to the Trustees on appellant‘s behalf. She framed the “main issue” as whether appellant owed contributions for work done by “outside trucks” and noted that “we were under the assumption that they were paying their own union benefits.” Volante did not dispute that appellant had an obligation to make payments to the Fund or that it owed contributions for the outside work. Instead, she expressly acknowledged “a responsibility to the funds” that “[w]e are not skirting.” Nevertheless, Volante offered only $35,000.00 as the amount appellant could afford and noted, as a thought for consideration, that appellant had not signed a CBA since 1989.
The Trustees rejected appellant‘s offer and brought the instant suit. Appellant thereafter moved to dismiss the action for lack of subject matter jurisdiction, and appellee moved for summary judgment. Judge Gershon denied appellant‘s motion to dismiss, granted appellees’ summary judgment motion, and referred the case to Magistrate Judge Pohorelsky for an inquest. In a December 22, 1998 Memorandum and Order, Judge Gershon adopted Magistrate Judge Pohorelsky‘s recommendation to award appellees $248,514.03 in damages, interest, attorney‘s fees and costs. This appeal followed.
DISCUSSION
a) Subject Matter Jurisdiction
Relying on Laborers Health & Welfare Trust Fund v. Advanced Lightweight Concrete Co., 484 U.S. 539 (1988), appellant argues that the district court lacked subject matter jurisdiction over the Trustees’ claims for benefit fund contributions owing on work performed during a period when appellant was not bound by a collective bargaining agreement. We disagree.
Although it is true that the Trustees’ claims arise from appellant‘s alleged failure to contribute to the Fund after the signed CBA expired, this does not render them per se unfair labor practice claims over which the district court lacks jurisdiction under Advanced Lightweight. The Trustees are not arguing that appellant has unlawfully refused to bargain by making unilateral changes in working conditions before reaching an impasse over a new CBA. Rather, the Trustees claim that appellant promised to contribute to the Fund by adopting the two CBAs that it never signed. Appellees’ claims are thus clearly for “contributions [owing] in accordance with the terms and conditions of . . . [a collective bargaining] agreement,”
b) Summary Judgment
Appellant next argues that the district court improperly granted summary judgment because there are genuine issues of fact as to whether appellant adopted the two unsigned CBAs. We disagree.
We review the grant of summary judgment de novo. See Cronin v. Aetna Life Ins. Co., 46 F.3d 196, 202-03 (2d Cir. 1995). A moving party is entitled to summary judgment when, after reviewing the evidence in the light most favorable to the nonmoving party, there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. See
Appellant argues that the unsigned CBAs do not satisfy the ERISA Section 302(c)(5)(B) requirement that payments to a trust fund be made pursuant to a “written agreement with the employer.”
Because there is no dispute that the unsigned CBAs set forth a sufficiently detailed basis on which the payments were to be made, the only question is whether appellant‘s conduct manifested an intent to adopt, or agree to, the unsigned CBAs.
As noted above, the Trustees’ proffer, absent rebuttal, suffices to show adoption of the CBAs as a matter of law. In response, appellant contends, first, that it did not actually comply with the CBA provisions requiring it to contribute to the Fund. However, appellant concedes that, for the period covered by the audit, it contributed to the Fund at the rate prescribed by the unsigned CBAs. Even with regard to contributions for the “outside” drivers it hired -- the issue in this case -- Volante‘s letter to the Trustees manifests appellant‘s understanding that it was bound to contribute to the Fund on behalf of these employees. The Volante letter thus not only fails to create a genuine issue as to liability, but actually tends to establish adoption of the unsigned CBAs.
Finally, appellant points to a letter from the Union requesting that appellant sign the 1990-1993 and 1993-1996 CBAs. The letter began by stating “we are aware that your dues and benefit contributions are paid timely and to date” but informed appellant that it could not process a Union book for one of appellant‘s new employees until the CBAs were signed. This letter states, however, only what is undisputed -- that the CBAs are unsigned. It does not undercut appellant‘s conduct indicating that it intended to be bound by the unsigned CBAs.2
Moreover, that appellant subsequently hired the employee whom the Union declined to admit as a member does not, in these circumstances, create a genuine issue of material fact. Appellant‘s hiring of this non-Union employee may have breached the CBAs, but appellant proceeded to contribute to the Fund on behalf of this employee, thus further manifesting its intent to be bound by the CBAs’ trust fund provisions.
Appellant has not, therefore, demonstrated the existence of a genuine issue of material fact as to whether its conduct manifested an intent to adopt the unsigned CBAs.
c) Damages
Having carefully reviewed the record at the inquest, Magistrate Judge Pohorelsky‘s final report and recommendation, and Judge Gershon‘s decision adopting that report, we find no clear error in the district court‘s findings in connection with its damages award.
Appellant makes three principal challenges to the district court‘s findings in connection with its damages award, which we address in turn. We review these findings for clear error. See
First, appellant argues that the district court erred in crediting the auditor‘s assumptions that work performed by two employees in 1992 was “covered work” -- work for which appellant owed contributions to the Fund. The district court was warranted in crediting this assumption, however, because appellant made contributions for these same employees during 1993 and the employees’ wages for this work in 1992 were comparable to their 1993 wages.
Second, appellant argues that the district court should have discredited the auditor‘s testimony that appellant was not “double billed” for these employees’ work. Appellant points to the auditor‘s testimony that he could not be sure, at the time of the hearing, whether he double billed hours. In this same hearing, however, the auditor testified that his recollection was that, at the time he prepared the report, he deducted any hours for which appellant had already contributed to the Fund in accordance with the auditor‘s usual practice. The district court did not clearly err in finding this recollection credible.
Finally, appellant argues that the auditor unreasonably considered subcontracted employees’ work as covered work, even though the CBA requires the Union to give an employer notice of its obligation to make contributions to the Fund for subcontracted employees’ work. The problem with this argument is that it is only an argument, not supported by any evidence that the employees at issue were actually subcontracted. Moreover, appellant‘s argument is based on a selective reading of the CBA. The relevant provision requires, first, that appellant notify the Union “on a weekly basis . . . of the hours worked by” outside drivers. If the outside drivers’ employer does not make the requisite contributions to the Fund, then the Union is required to notify appellant of its obligation to contribute on the outside drivers’ behalf. Appellant presented no evidence at the damages hearing that it notified the Union of its employment of outside drivers. Appellant cannot, accordingly, invoke the protection of the above-quoted CBA provision, and the district court did not err in crediting the auditor‘s testimony that appellant owed contributions for these employees’ work.
CONCLUSION
We therefore affirm.